Computing the Net Price using the Complement Method
Introduction
Another way of finding the net price is the complement method.
The complement of the trade discount rate is 100 percent minus the discount rate.
This is sometimes called the net-price rate.
The list price is then multiplied by the complement to find the net price.
Net Price = List Price × Complement of Trade-Discount Rate
Example
Zoho Applicances is purchasing a freezer engine for a super freezer. The list price of the engine is
$399. Zoho Applicances receives a 25 percent trade discount from the wholesaler. What is the net price
of the engine?
The answer is as follows:
- Find the complement of the trade-discount rate. Complement of the trade-discount rate = 100% − 25% = 75%.
- Find the net price. Net Price = List Price × Complement of Trade-Discount Rate. $399 × 75% = $299.25
Practice: Find the complement and net of price of the below examples.
Trade Discount and Net Price
| List Price | Trade Discount Rate | Complement | Net Price |
| $350.00 | 25% | ??? | ??? |
| $450.00 | 20% | ??? | ??? |
| $650.00 | 20% | ??? | ??? |
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Date of last modification: March 5, 2019